Asahi Group (2502) Business update presentation summary

Executive summary and business update

• Q1 2026 revenue missed targets in Europe and Asia Pacific due to challenging market conditions, but cost efficiencies kept core operating profit near plan in both regions.

• Revenue in Japan & East Asia is steadily recovering as distribution normalizes and marketing efforts intensify.

• Growth investments and structural reforms are planned for Europe and Asia Pacific, with a focus on profitability in Japan & East Asia ahead of peak sales and tax changes.

• The East Africa acquisition will temporarily raise financial debt, but capital allocation will prioritize financial soundness and shareholder returns.

• FY2025 results will be disclosed in July, and an interim dividend of JPY26 per share is scheduled for FY2026.

Regional performance

• Europe Q1 revenue declined 2.4% YoY, mainly due to lower sales in Poland and Romania, but cost controls kept core operating profit in line with plan.

• Asia Pacific Q1 revenue grew 1.5% YoY, driven by strong Easter trading in Oceania, though Southeast & South Asia underperformed.

• Core operating profit in Asia Pacific saw a mid-single-digit YoY increase, supported by higher sales volume and improved product mix.

• Japan & East Asia sales are gradually recovering from system disruption, with April 2026 showing a significant YoY rebound in some categories.

• Asahi Group Foods has broadly recovered to previous year levels, while beverage and brewery segments are still below but improving.

Sales recovery and operational progress

• Distribution operations in Japan & East Asia have largely resumed, with flagship products like Asahi Super Dry already recovered and others still in progress.

• Convenience store sales for soft drinks recovered first, while mass retail is still catching up due to the complexity of reintroducing products.

• Focus remains on regaining distribution outlets and boosting sales per outlet, especially in high-demand categories.

• Profitability-focused sales recovery and new product development are key priorities for the coming quarters.